Investor Presentaiton

Backup E.3.1 Infrastructure Roads & Transport: Uganda Road Fund finances the maintenance of 80,000km public roads in the country Uganda • · • Context Road transport is key to Uganda's economic success and social development, but often times it has to compete for funding with other key sectors in Uganda (e.g., health, education, and security) Many countries established special off-budget accounts such as Road Funds to earmark selected road use taxes & charges for road sector The performance of the 1st generation Road Funds was generally considered poor, Uganda is the last country in the East African Region to launch a 2nd generation road fund What did Uganda do? Uganda introduced the Road Fund Act in 2008 to support road maintenance, however the Fund became operational in 2010 The URF¹ has a mandate to provide adequate and stable financing for maintenance of the 80,000km public roads in Uganda The URF1 is funded by fuel levies, transit fees, road license fees, axle load fines, tolls, traffic and road safety fines, appropriations by Parliament, and donations/grants The URF1 is governed by seven Board of Director members with private sector majority, and operated by a lean thirty staff secretariat || || || Key successes Dedicated funding sources - the URF1 Act clearly specifies the types of road use fees and charges while maintaining flexibility by also including appropriations, donations and grants Operating URF1 in a business-like manner - the majority of the seven- member of Board of Directors are from the private sector, and a fee- for service principle Independence of URF1 from road regulators (policy setting) and road operators (maintenance & management) Learnings for Plateau State Work with the state government to establish a Road Fund with dedicated funding sources such as road use fees and charges Operate the Fund like a business enterprise A Board of Directors as the governing body with private sector majority Separation from road regulators and operators A lean staff with clearly responsibilities and accountability Source: Uganda Road Fund Act; BCG Analysis 157 Copyright 2019 by Boston Consulting Group. All rights reserved. A

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